site.btaObligations of Non-financial Enterprises Will Continue to Grow

Obligations of Non-financial Enterprises Will Continue to Grow

Sofia, February 23 (BTA) - The obligations of the non-financial
enterprises will keep on increasing in absolute terms in 2015,
Bulgarian Industrial Association (BIA) Vice President Kamen
Kolev said at a news conference on Monday.
   
In late 2013, these obligations exceeded 171,000 million leva,
up by 13,000 million leva or 8.3 per cent as from 2010. Compared
 to 2012, the increase is by 3,100 million leva or 1.9 per cent.

BIA expects a modest economic growth of 1 per cent and an impact
 of deflation processes, which will suppress growth through
lower revenues but will be favourable for households and
companies in regards to their expenditures. The high level of
non-serviced credits will be a burden for the economy: cases of
insolvency and, thence, bankruptcy will increase as the sectors
at highest risk are: Trade, Construction and Services. The slow
bankruptcy procedures will also exert an influence on the
accumulation of obligations, including intra-company ones.

According to the BIA analysis, as at the end of 2013, the
companies of the Trade Sector had the highest obligations,
followed by the ones of Industry, Energy, Corporeal Immovables
and Construction.   
   
Of a total of 171,000 million leva obligations,  68 per cent are
 intra-company, 28 per cent - ones to financial companies and 1
per cent to employees. Overdue debts are outlined as a major
problem as they account for 35 per cent of intra-company
obligations. It is possible to minimize them through fast
settlement of trade disputes and, for this reason, BIA suggests
to include arbitration clauses in contracts. Another possibility
 for settlement of intra-company debts is through mediation of
the Chamber in the purchase/sale of such debt via a specialized
on-line platform. BIA keeps on insisting on the establishment of
 a Clearing House with the participation of the state. The
Clearing House should have funding of at least 1,000 million
lev, according to BIA estimates.

In 2013, outstanding payments due to the business by state and
municipally-owned companies amounted     to 108 million leva and
169 million leva, respectively. BIA insists to provide
information about due payments to the business within public
procurement contracts and VAT refund on a monthly basis.